Ebay India in Trouble

Ebay.in formally knows as bazee.com is a poor cousin of ebay.com… possibly very poor. No! I don’t have their financials on hand and nor did anyone from the inside tipped me off. I have been around the “internet” block so many times that I tend to pick up the tell tale signs.

As I was casually surfing on ebay looking for stuff, I noticed that they have started putting in google adsense ads all over the place. Google adsense is a program for website owner to display content related ads and make money from it. I have not seen any such google ads on ebay.com and nor on their other country specify auction portals. So why is ebay India any different… well for starters they arn’t making money from their core business and have to resort to other ways to cover cost.

A lot of people on ebay.in sell and purchase products on a one time basis and when they complete the transaction… they don’t want to pay the commission due to ebay, this results in a lot of revenue loss for ebay because they still have to pay for the support staff, the programming; marketing and other divisions… not to forget the enormous bandwidth which they use up every month.

Though there is nothing wrong with putting google adsense and making money off it, the problem comes when you give it premium placement. This makes a statement that they want their primary source of income to be from advertising and not from the services they are offering. Imagine you are selling T-shirts from your website, would you place a competitors ad and give it premium display space so that the visitors to your online store click those ads and go away? … sure you made Rs 5 from the click but is that really worth the loss in revenue from a T-shirt sale?

Remember a couple years back when bazee.com started advertising like crazy on TV, the reason was back then they were in talks with ebay.com and they had to show activity on their website and lots of it… they had to show millions of users registered but a million users can’t always guarantee business and that’s what happened. If ebay does not make some drastic changes to the way they are running the show, they will loose their entire business to the upcoming and completely free classifieds websites.

Comments are closed.